Wednesday

25th Apr 2018

Russia to stop gas to Ukraine, rejects EU proposal

  • Oettinger in Kiev at 2am local time on Monday said talks had broken down (Photo: ec.europa.eu)

Russian firm Gazprom is stopping gas supplies to Ukraine after talks on a new price broke down in the small hours of Monday (16 June).

It said in a statement published at 10am Moscow time – its deadline for Ukraine to pay almost $2 billion of old debt – that it is switching to "prepayment for gas supplies … Starting today, the Ukrainian company will only get the Russian gas it has paid for".

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

It added that Ukraine has not made prepayments for June.

The situation does not mean immediate shortages for Ukraine or for EU countries which get Russian gas via Ukraine because Ukraine has large volumes in its storage vaults and demand is low in summer.

But unless the dispute is resolved, it could lead to the kind of winter crunch which saw power outages in Europe in 2009.

The high-level talks in Kiev on Sunday, which involved EU energy commissioner Gunther Oettinger, ended when Russia rejected an EU compromise proposal.

The commission suggested Ukraine pays $1 billion of its debt now and the rest in six tranches by the end of the year, in part using money from EU and International Monetary Fund assistance.

It also suggested Ukraine in future pays a price of $385 per thousand cubic metres in winter and $300 in summer. But Russia said it would not go lower than $385 overall.

"The Ukrainian side was ready to accept this, but for the moment the Russian partners were not," the EU said in a statement. "The commission is convinced that a solution is still possible and … will reflect on the next steps and on when to bring the parties together again."

The $385 is close to average European market rates. But it is higher than the $268.5 price offered by Russia to Ukraine's ousted leader Viktor Yanukovych last year as an incentive to abandon EU integration.

The gas talks are taking place in a volatile atmosphere.

Ukrainian leader Petro Poroshenko in a phonecall with French President Francois Hollande on Saturday urged the EU to impose economic sanctions on Russia.

His appeal came after pro-Russia rebels shot down a Ukrainian military plane killing 49 servicemen.

The EU and US have threatened to take the step unless Russia de-escalates the conflict in east Ukraine by the end of the month, when the EU and Ukraine plan to sign a free trade treaty.

EU Council chief Herman Van Rompuy in a statement also on Saturday did not mention sanctions.

But he said: "There is … no doubt that the armed fighters that are terrorising and disrupting the lives of citizens in Ukraine, are enjoying external support, including arms supply and reinforcement through foreign fighters."

"Russia bears a primary responsibility in ensuring that any such traffic and external support through its borders is immediately stopped."

The death of the 49 Ukrainian soldiers prompted violence outside the Russian embassy in Kiev on Saturday.

A crowd of some 200 people threw paint, eggs, and stones at the building. A Russian flag was ripped up and cars overturned.

Ukraine's acting foreign minister, Andriy Deshchytsia, went to the scene to urge people to protest in a peaceful way.

He said, according to Reuters, that: "We must fulfil our international obligations, including defending the right of Russia to have an embassy in Ukraine." He then added: "Did I say that I am against you protesting? I am for you protesting. I am ready to be here with you and say 'Russia, get out of Ukraine' … Yes, Putin is a dickhead, yes."

His jibe saw some Russian MPs call for his dismissal, while Russian foreign minister Sergei Lavrov told Russian media: "I don't know how he will talk to us and work with us now."

The US also "condemned" the stone throwing against the Russian embassy.

Finland most vulnerable to Russian gas cut-off

Finland would experience gas shortages if Russia cuts off exports for one month, while other EU countries would last between three to nine months without Russian gas, according to a German study.

News in Brief

  1. UN expects over $4bn in pledges for Syria
  2. Commission wants more public data made available for reuse
  3. Study: Brexit will hit all European farmers
  4. European media face rise in 'verbal violence' from politicians
  5. Greenland PM to keep power despite poll slump
  6. Commissioner optimistic on FYROM name solution
  7. Italian court keeps NGO migrant rescue boat docked
  8. German Jews warned not to wear skullcap in public

Stakeholders' Highlights

  1. Sustainable Energy Week 2018"Lead the Clean Energy Transition"- Register and Join Us in Brussels from 5 to 7 May
  2. EU Green Week 2018Green Cities for a Greener Future. Join the Debate in Brussels from 22 to 24 May
  3. Nordic Council of Ministers12 Recommendations for Nordic Leadership on Climate and Environment
  4. Macedonian Human Rights MovementOxford Professor Calls for an End to the Anti-Macedonian Name Negotiations
  5. ACCAPeople Who Speak-Up Should Feel Safe to Do So
  6. Mission of China to the EUProgress on China-EU Cooperation
  7. Nordic Council of MinistersWorld's Energy Ministers to Meet in Oresund in May to Discuss Green Energy
  8. ILGA EuropeParabéns! Portugal Votes to Respect the Rights of Trans and Intersex People
  9. Mission of China to the EUJobs, Energy, Steel: Government Work Report Sets China's Targets
  10. Martens CentreJoin Us at NET@WORK2018 Featuring Debates on Migration, Foreign Policy, Populism & Disinformation
  11. European Jewish CongressKantor Center Annual Report on Antisemitism Worldwide - The Year the Mask Came Off
  12. UNICEFCalls for the Protection of Children in the Gaza Strip

Latest News

  1. Whistleblowers could be enforcers of rule of law in Europe
  2. EU shelves Macron idea for 'European Darpa'
  3. Don't play EU 'games' with military HQs, Italian admiral says
  4. EU had a plan for Jordan - now it's time to make it work
  5. Time for EU to take charge of global health research agenda
  6. EU in race to set global Artificial Intelligence ethics standards
  7. Juncker delays air quality action due to busy agenda
  8. Spain makes bid for EU naval HQ

Stakeholders' Highlights

  1. Mission of China to the EUForeign Minister Wang Yi Highlights Importance of China-EU Relations
  2. Nordic Council of MinistersImmigration and Integration in the Nordic Region - Getting the Facts Straight
  3. Macedonian Human Rights MovementMacedonians in Bulgaria Demand to End the Anti-Macedonian Name Negotiations
  4. Counter BalanceThe EIB Needs to Lead by Example on Tax Justice
  5. ILGA EuropeTrans People in Sweden to be Paid Compensation for Forced Sterilisation
  6. International Partnership for Human RightsThe Danger of Standing Up for Justice and Rights in Central Asia
  7. Mission of China to the EUChina and EU Must Work Together to Promote Global Steel Sector
  8. Swedish EnterprisesEU Tax Proposal on Digital Services Causes Concern for Small Exporting Economies
  9. European Jewish CongressCondemns the Horrific Murder of Holocaust Survivor Mireille Knoll in Paris
  10. Mission of China to the EUAn Open China Will Foster a World-Class Business Environment
  11. ECR GroupAn Opportunity to Help Shape a Better Future for Europe
  12. Counter BalanceControversial Turkish Azerbaijani Gas Pipeline Gets Major EU Loan